Banks told to reschedule poultry loans

In a major relief to the poultry industry that has been rattled by the bird flu crisis in the last few weeks, the Reserve Bank of India (RBI) has asked the banks to reschedule loans given to the poultry units across the country. RBI wrote to all scheduled commercial banks on Tuesday, providing guidelines to them to give a breather to the poultry industry. It asked the banks to convert principal and interest due (on working capital loans), instalments and interest on term loans due for payment on or after the onset of bird flu into term loans. The RBI suggested that the banks could consider December 31, 2007 as cut-off date for such conversion, and treat the rescheduled or converted loans as current dues. “The process may be completed by April 30, 2008,” Mr G. Srinivsan, Chief General Manager of RBI, said in the letter. After conversion, the borrowers would be eligible for fresh need-based finance. The relief would be extended to all accounts of poultry industry, which are classified as ‘standard accounts’ as of the cut-off date. The apex bank had issued similar guidelines to the banks in April 2006 to bail out the poultry industry.